Difference between On-Demand Pay and Traditional Payroll

Basis	Traditional Payroll	On-Demand Pay
Payment Methods	On the scheduled payday, wages are usually paid by paper checks, direct deposit into the employee’s bank account, or other approved payment methods.	Several payment options, such as direct deposit, quick transfers to a connected bank account, or top-loading a prepaid debit card, may be available on on-demand pay systems.
Fee Structure	Receiving wages using standard payroll systems is typically free of charge.	Certain on-demand pay service providers may impose transaction or membership fees in order to receive earned earnings ahead of time.
Budget	Since they will know when they will receive their entire pay period, employees may find it easier to manage their finances and create a budget around a fixed payday.	As employees can access their earned earnings early, on-demand pay has the potential to disrupt established budgeting techniques.
Employer Cost	Payroll processing costs, such as administrative charges, payroll software or services, and possible overhead costs, are borne by the employers.	Employers might face extra costs as a result of on-demand pay, such as early wage access fees from on-demand pay providers, integration fees with current payroll systems, or continuous platform maintenance charges.

On-demand Pay: Meaning, Types, Benefits and Examples